In a joint statement yesterday, Treasurer Scott Morrison and the Minister for Revenue and Financial Services Kelly O’Dwyer announced that the government would provide ASIC with $70.1 million which would go towards strengthening ASIC’s enforcement capabilities.
Mr Morrison and Ms O’Dwyer confirmed $8 million of the new funding will go towards executing a “new supervisory approach” which would include embedding ASIC staff within NAB, ANZ, CBA, Westpac as well as AMP for the purposes of monitoring governance and compliance.
Speaking in Melbourne alongside Mr Morrison and Ms O’Dwyer, Mr Shipton said outlined how quickly a team from the regulator could be “going onsite”.
“We will be initially starting, very soon, in the weeks ahead, with a particular focus on governance structures and a particular focus on breach reporting,” Mr Shipton indicated.
This would involve a team from ASIC of “up to 20 people” temporarily based within the big banks.
“They will be spending significant amounts of time inside financial institutions. That may be days, may be weeks, may be months, depending on the project at hand, depending on the task at hand and depending on the harm that we’re trying to solve for.”
Furthermore, the ASIC agents would have free reign in engaging with staff “at every single point in a financial institution to provide that effective regulatory coverage”.
“That could be the CEO, it could be the chair, all the way through to the men and women who are in the particular business unit. We will calibrate our response depending on the challenge at hand and the task that is before us,” Mr Shipton said.
He urged banks to develop a strategy for “positive and productive engagement with regulatory agencies” to the end of creating a “positive culture” within financial entities.
Ms O’Dwyer said the new funding for ASIC came after Mr Shipton conducted a strategic review that found the regulator needed “better resources to be able to ensure that their supervisory approach can be much more part of the day-to-day activities of some of our biggest financial institutions”.
“So, for the first time, we’re going to see ASIC actually having ASIC people in our top four banks, our big banks, and also AMP, as our five biggest financial institutions in this country.
“That will mean that there is a greater ability for the regulator to be able to prevent misconduct,” she said.
Mr Shipton said that the embedding of ASIC staff would have an impact on decision-making.
“We will have supervisory officers embedded for significant periods of time inside these large financial institutions because I know it makes a difference to the way that they behave.
“I know that it will make real, positive outcomes, when it comes to the way financial institutions should treat customers – and that should be fair.”
Surely the answer is simpler Ms O’Dwyer? Just make all bank and insurance execs re-sit degrees in Financial Services and perhaps include yourself in this. This way we might start seeing some sensible ideas and outcomes instead of the crazy legislation you keep implementing that will ultimately destroy the industry.
Nice to see you think further education will bring sensible ideas and outcomes from bank and insurance execs. The majority of readers suggest that having to do more study is not the solution!
Um, I think they were being facetious and that was the whole point… sheesh.
(refer to Marvel’s Drax ‘fly over my head I catch it’ comment).
Actually Anon it was sarcasm. Of course the answer is not further education but if O’Dwyer thinks it is then she should be insisting that Bank and Insurance execs undertake the same as these people have been the source of most of the scandals. And perhaps she should follow suit and re-educate to understand how ludicrous her approach on this has been.
Morrison and O’Dwyer who both apposed the RC now trying to save face and look like they are acting tough with yet another ludicrous proposal. O’Dwyer has no idea about financial services and should be replaced.
Yes I just can’t believe that in a capitalist free enterprise system, which of course is not perfect, there will be bureaucrats wandering around looking over the shoulders of bank staff at every level.
Just what qualifications and background will these people have? If you don’t have a decent background and career experience in the banking and finance world how will they be able to audit and monitor the systems and procedures?
In any event, this is government direct interference in private businesses, totally unprecedented and uncalled for no matter what has happened in the past.
Surely we can have the laws and regulations and audits that will clean up the industry without this incursion into workplaces?
I pose the question, what business entity or even government department has not got some questionable behaviour or bad practices which may adversely affect clients and customers and the public at large.?
the answer to your question what qualification will they have, well that’s easy, as legal one. How many people in ASIC DON’T have a legal one. And all have an opinion…
We’ve been the envy of the civilised world with how we fared throughout the GFC and the integrity of our financial system, and yet the bureaucrats want to weasel in and clog a working system with more useless red tape. Note the colour btw, the lefties in our political and social system must be wringing their hands with glee at this latest insanity. (nope, not a bank aligned person, just calling it from an outside perspective, nothing good can come from this).
Actually, it was the “lefties” who implemented the (interventionist) policy that “saved” Australia during the GFC and it was the banks that needed to be rescued (one in particular, that was on the brink) by we taxpayers who guaranteed all deposits – and still do! How you people keep writing this nonsensical stuff is beyond me. The “Red” tape is actually the pink tape that lawyers use and it’s the regulations that you’re probably referring to that is actually an investment made over decades of experience to control the behaviour of those who very clearly NEED to be controlled – hence the Royal Commission findings so far.
Orwellian much?
I find it concerning that Gov’t will put their staff into private business. What’s next? an ASIC rep in every Planners office?…. Are we living in China?
Well the Banks (Senior Management) could not be trusted. Now it sounds like neither the Government -nor the public for that matter – are willing to trust them again in the future without further supervision and now in-office oversight. What alternative would you suggest?
And on cue, enter the left side into the discussion to fly that flag… Jape.
Varying forms of BID obligations where miscreants (including CEO’s and board members) are personally held liable would radically change their risk return assessments when making questionable decisions.
“Varying forms of BID obligations”. What does that waffle mean? Do you mean The Corporations Law boof? If AFSL Executives were Representatives they would be held to a high standard – that of an Adviser who may be banned or disciplined. However these Execs cannot be Representatives as they are not suitably qualified.
Hmmm, a red under the bed
and now
an ASIC w ank in the bank